The Audubon Commission owes $1.7 million in Hurricane Katrina-related public assistance funds to the Federal Emergency Management Agency, according to an audit released Aug. 22 by the Office of Inspector General with the U.S. Department of Homeland Security.

FEMA awarded the commission -- a city agency that oversees Audubon Park, Audubon Zoo, the Aquarium of the Americas, Woldenberg Park and several other facilities -- $12.3 million for damages resulting from Hurricane Katrina and the failure of the federal levees. The money was to reimburse Audubon 100 percent for 37 large and 44 small projects.

The money FEMA seeks to reclaim consists of ineligible labor costs, unallocated insurance, unused funds and money wrongfully dispersed because of an accounting error. according to the audit.

The audit was conducted between May 2012 and June 2013. Its findings include:

The commission claimed $427,807 of labor costs for debris removal and emergency protective measures performed by full-time Audubon employees who were classified as contractors. Under federal regulations, labor costs can't be reimbursed if the work is performed by the applicant's own employees. Commission officials said they listed the workers as contractors at the instruction of the Louisiana Governor's Office of Homeland Security and Emergency Preparedness, which dispersed the FEMA funds.

The commission received $2.78 million in insurance proceeds for property damage, but the actual cost was $1.54 million, meaning that $1.2 million needs to be returned.

FEMA inadvertently allocated and should reclaim $76,800 in insurance proceeds from the commission.

The commission completed eight large projects at a cost of $739,392, which was $142,697 less than the amount estimated and paid by FEMA; that leftover money should be deobligated and put to better use.

The Audubon Commission has 90 days from the date of the audit to respond to its findings, come up with a corrective plan and set a target date to resolve each issue.

"We are reviewing the numbers to make sure everything is correct, and we will come to a mutually acceptable agreement with FEMA," the commission said in a statement.

The Homeland Security inspector general's office recommended in February that $7.6 million in FEMA grant money set aside to rebuild the Katrina-damaged and still-shuttered Audubon Louisiana Nature Center in eastern New Orleans be rescinded. It said the money was improperly promised to the Audubon Commission and not the private, nonprofit Audubon Nature Institute, which operated the center before Katrina.

The
center in Joe W. Brown Park included a science center, a planetarium
and a 2-mile-long boardwalk, all of which were damaged or destroyed by
floodwaters in the aftermath of the hurricane.

The inspector general's report also said that of the 29 projects that would have been built with the
money, 20 projects totaling $6.9 million still had not begun
construction seven years after Katrina.